Grow or Die: The New Mantra of Small Business
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CREDIT: Dreamstime
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Small-business owners are willing to risk it all to grow their business. Despite the fact that some business owners think it could cost them their business, three out of every four small-business owners plan to try to substantially grow their businesses in the next five years, according to recent research.
Nearly a quarter of business owners, 24 percent, see the risk associated with doubling sales in the next five years as acceptable even though they believe it will challenge the survival of their business. Additionally, 10 percent of business owners see such growth as being very risky while 39 percent are undecided on the benefit or risk of growing sales, according to a new study by the National Federation of Independent Business.
Even with the risks, 43 percent of small-business owners hope to grow their businesses 50-to-200 percent in coming years and 11 percent want to grow 500 percent or more. While contemplating such large growth, many owners are neutral about the prospects for growth in coming years. Over a quarter, 27 percent, of business owners believe that desired growth and employment numbers are unlikely while 36 percent believed achieving these numbers is possible and 36 percent believe that desired growth is very likely.
The desire for growth does not simply represent a means to improve the bottom line; 63 percent of respondents believed that a larger business would be better able to deal with a business crisis.
"Small-business owners are generally positive about the prospect of growing their business and have realistic expectations for the level of growth they will achieve," William Dennis, senior fellow at the NFIB Research Foundation, reported. "We are forced to conclude that growth constraints are seldom self-imposed; instead, growth impediments are external, the consequences of environmental actors and phenomena beyond their control."
Business owners agree that impediments to growth lie mainly outside their organizations. According to the report, the main external constraints include "weak demand and the availability of skilled labor" while internal constraints center on the "undesirable consequences of growth or efforts to achieve it."
The information in the National Federation of Independent Business Small Business Poll is the second study in a series about small-business growth.
Reach BusinessNewsDaily staff writer David Mielach at Dmielach@techmedianetwork.com. Follow him on Twitter @D_M89.